METHODS: Policy document review and key informant interviews have been conducted in 8 Provinces.

RESULTS: IPCD was promoted by the State Council to cover Urban Resident Basic Medical Insurance (URBMI) and New Rural Cooperative Medical Scheme (NCMS) enrollees but Urban Employee Basic Medical Insurance(UEBMI) enrollees are also covered in some cities. Financial contribution rate, benefits package and operation of IPCDs vary among different cities and have close associations with local Basic Medical Insurance schemes (BMI). IPCD serves as an extension of BMI in two perspectives: the premium of IPCD is directly transferred from BMI fund and IPCD provides further reimbursement on the copayment after the reimbursement by BMI with a certain deductible, copayment rate and ceiling of payment. At least one city’s IPCD covers medications not included by provincial BMI reimbursable list. The majority of IPCD are operated by commercial insurance companies (CIC) under guidance of local BMI agency. Net loss, reputation and market share are the key indicators for the competitive bidding among CIC. In the early establishment of IPCD, BMI agencies share the responsibility with CIC if IPCD underwent deficit since the change of health services utilization is not predictable after introduction of IPCD due to lack of baseline observation. The partnership with CIC brings additional human resources to supervise health services provision, which benefits not only IPCD but also BMI. However, BMI agencies’ concern on the security of BMI enrollees’ information become major barrier for sharing information with CIC. CONCLUSIONS: IPCD relieves financial burden of patients by providing further reimbursement but its benefits package remains limited to BMI reimbursable list. CIC play an important role in supervising health services provision yet their specialties on actuarial services or risk control is under-developed.